Matthews v Chief Executive, Department of Lands

[1994] QLC 38

[1994] QLC 38

 

  LAND COURT

BRISBANE

5 August, 1994

Re:  Appeal against a Categorisation of a
  Lease under the provisions of the
Land Act of 1962 -
  Kilkivan Local Government.
  Ref: VC94-0063.

NR and LR Matthews
  v.
  Chief Executive, Department of Lands

D E C I S I O N

This appeal is brought by NR and LR Matthews under the provisions of Section 235A(6) of the Land Act of 1962 against the decision of the Chief Executive, Department of Lands, to include their Special Lease within Category 3 (rural residential) for rental assessment purposes. It is contended by the appellants that the lease should be included within Category 1 (grazing). The lease is more particularly described as SL 21/32227, Gympie District, being Lot 274 on Plan LX 1475, Parish of Brooyar, and contains an area of about 30.66 hectares. It is situated approximately 4 kilometres north of the small township of Woolooga on the Bauple-Woolooga Road. It is zoned Rural under the provisions of the Kilkivan Local Government Town Planning Scheme and is used by the lessees in conjunction with about 200 hectares of other land for grazing beef cattle. The purpose for which the lease was issued is for Manufacturing, Industrial, Residential or Business. The lease commenced on 16 July, 1968, and the term is for 30 years expiring on 15 July, 1998.
           The Land Amendment Regulation (No 1) of 1993 introduced categorisation of leases.  Special leases are included within the categorisation provisions as prescribed in Section 10(1) of the Land Amendment Regulation.  A large number of categories were introduced of which only two are relevant to this appeal.  They are:-

(a)Category 1 - Grazing and Agriculture

and

(c)Category 3 - Residential and Rural Residential.

Section 11 of the Land Amendment Regulation describes Category 1 leases as:-

(1)A lease is a category 1 lease if its primary use may be, and is, grazing or broadhectare agriculture and

(2)A lease for grazing purposes over a State Forest or a reserve is a category 1 lease.  (Not relevant in this case).

Section 12A of the Regulation describes Category 3 leases as being:-

(1)A lease that may be used, and is used, solely for residential purposes is a category 3 lease.

(2)A lease that would otherwise be a category 1 lease or a category 2 lease is a category 3 lease if -

(a)  it is located close to a city, township or closer settled area; and
  (b)  a dwelling house is, or under the lease, could be, erected on it; and
  (c)  its market value would be based on its value as land able to be   used for residential purposes.

(3)A special lease for grazing purposes is a category 3 lease if -

(a)      a dwelling house is, or under the lease could be, erected on the   land; and

(b)the lease is not otherwise a category 1 lease.

Now, it is clear that if the appellants are to succeed in this case, the Court must conclude that the lease should be included as a category 1 lease in terms of Section 11(1) of the Land Amendment Regulation of 1993.
           The appellants called in evidence Lindsay Herbert Horswood, who is a practising Registered Valuer.  Mr Horswood told us that he has not inspected the lease but is familiar with its location.  He was asked in general terms about the factors which should be taken into account when valuing special leases but really this evidence is not of assistance to me in a categorisation case.  Of relevance, however, is evidence from Mr Horswood that the subject lease is situated in an area where there are a deal of 12/16 hectare residential subdivisions.  Mr Horswood pointed out that the market value of a special lease with just three years to run is a factor to be taken into account when valuing special leases but this again seems to me to have no bearing on a categorisation case as the matter of the value of the land and/or the lease is not an issue. 
           Neville Ray Matthews, who is a joint lessee, was called in evidence.  Mr Matthews' grounds of appeal read:-

"We do not have any intentions ever of erecting any buildings whatsoever on SL 21/32227.  Our only intention is to have the land fenced, as it already is, so that we can graze cattle on it.  "

Mr Matthews told us that he uses the subject lease for grazing about 8 head of cattle.  It and other land comprising an area of about 240 hectares is used to run 90 to 100 breeders.  He has put a dam on the land and has fenced it.  Mr Matthews has only ever used the land for grazing and he confirmed that it is not the lessees' intention to ever build a house upon it.  The lease carries a lot of regrowth.  Mr Matthews says the nearest town of Woolooga has an hotel, a shop, a hall and about 12/15 houses.
           Called in evidence by the respondent Chief Executive was Departmental Registered Valuer Bryan Alwyn Lyons, who said that the lease has been placed within category 3 for rental assessment purposes because:-

(1)The lease purpose is for Manufacturing, Industrial, Residential or Business activities.

(2)Under the lease a dwelling could be erected upon the land.

(3)Under the Town Plan a dwelling is an as of right use within the Rural zoning.

(4)The highest and best use of the land given the lease conditions and zoning is as a Rural Homesite.

(5)The land is located close to a closer settled area, a dwelling could be erected upon the land, and the market value of the land would be based on its value as land able to be used for residential purposes. 

Mr Lyons says that given the location of the land close to surrounding rural homesite areas, its highest and best use is as a rural homesite and the lack of restrictive conditions prohibiting dwelling construction upon it means that the lease should fall within the guidelines contained in section 12A of the Land Amendment Regulation of 1993.  Accordingly, Mr Lyons concludes that the lease falls within the category 3 definition.

Mr Lyons told us that there has been quite a demand for small sites in the Woolooga area over the last couple of years with small lots selling well at prices considerably in excess of grazing land values. He has never considered the value of the lease as opposed to the value of the land. It is clearly not necessary for him to do so in terms of section 15 of the Valuation of Land Act of 1944 but once again I repeat that the question of the value of the land (or as submitted by the lessees, the value of the lease) is not a relevant issue in this case.
           Now it is clear that the subject lease has a higher and better use than for grazing notwithstanding Mr Matthews' use of the land.  It adjoins or is situated close by to a number of 15 and 16 hectare subdivisions upon which a number of families live, although the evidence is that between it and Woolooga there is mainly grazing land.
           In the circumstances, I cannot find that the respondent Chief Executive has erred in including SL 21/32227, Gympie District, within category 3 for rental assessment purposes.
           Accordingly, the appeal is dismissed.

(C.H. Carter)      
  Member of the Land Court